Sibanye-Stillwater, Appian settle long-running dispute over terminated Atlantic Nickel deal

Sibanye-Stillwater and Appian Capital Advisory have reached a commercial settlement in their long-standing legal dispute stemming from the termination of Sibanye’s proposed acquisition of Appian’s Atlantic Nickel and Mineração Vale Verde assets in January 2022.

Under the terms of the agreement, Sibanye-Stillwater will make a total payment of $215 million, inclusive of £5 million in legal fees already paid, to settle the matter. The resolution comes ahead of a quantum trial that had been scheduled to commence on Monday.

The settlement ends nearly four years of legal wrangling between the two parties over Sibanye-Stillwater’s withdrawal from the $1 billion deal, which would have given the South African mining group ownership of key nickel and copper operations in Brazil.

The root of this dispute lied in a geotechnical event that occurred at the Santa Rita nickel operation in Brazil in November 2021, which Sibanye-Stillwater argued was significant enough to adversely affect the mine’s business and finances.

On 24 January 2022, Sibanye-Stillwater moved to terminate the share purchase agreements with Appian after the collapse of a pit wall at one of the mines, leading to the legal proceedings that have unfolded over the past few years.

Sibanye-Stillwater had planned to buy Santa Rita, one of the top nickel mines, and Serrote copper mine, as well as a 5% net smelter royalty over potential future underground production at Santa Rita.

Appian Capital subsequently brought a $1.2bn compensation claim against Sibanye-Stillwater.

However, Sibanye-Stillwater contended that no compensation ought to be paid as Appian Capital received multiple alternative offers for its mines, eventually selling the operations, which also include the Serrote copper mine, for $1bn.

Appian, a private equity firm focused on mining investments, welcomed the outcome.

“We are pleased to have reached a constructive resolution that reflects our commitment to acting in the best interests of our investors,” said Michael W. Scherb, Founder and CEO of Appian.

“This positive outcome allows us to close this matter on appropriate terms and focus our full attention on managing our funds and driving continued growth across our portfolio.”

Sibanye-Stillwater’s CEO, Richard Stewart, stated that the settlement was the most prudent course for the company and its shareholders.

“The board and management of the Group are convinced that the settlement of this protracted legal dispute is in the best interests of the Group and all its stakeholders,” Stewart said.

“We are pleased with the commercial settlement agreed, which precludes further legal processes and related costs being incurred, and provides certainty for the Group and its stakeholders, removing, on acceptable terms, a market overhang of close to four years after the proposed transaction with Appian was terminated.”

The agreement marks the conclusion of a high-profile dispute that had weighed on Sibanye-Stillwater’s investment outlook and market sentiment since the deal’s collapse.

With the matter now resolved, both parties said they would refocus on their respective growth strategies and operations.

BUSINESS REPORT